We are aware of this issue and it has been brought to the attention of our developers. A fix will be available in a future release of the RadControls for ASP.NET AJAX, although I cannot provide a firm estimate. It is logged in PITS and you can follow its status via this link
This issue affects only the appearance of the RadButton in Design mode of Visual Studio, so you will still be able to use it in your project without problems.
the Telerik team
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